500 kW, 1 MW and Beyond: What Industrial Power Requirements Mean When Choosing Premises

A client’s request for 500 kW or 1 MW of power should immediately change the way an industrial property search is approached. It is not simply another line item on a property brief. It can determine which sites are viable, whether a supply upgrade is needed, how long occupation may take and whether the cost of adapting a building makes commercial sense.

For a manufacturer, warehouse operator, refrigeration business, processing facility or logistics user, insufficient electrical capacity can turn an otherwise suitable property into an expensive mistake. The building may have the right size, location, yard and rental—but if the available supply cannot support the operation, the property may not be usable without significant time, cost and technical work.

This article explains what a 500 kW or 1 MW requirement means in practical industrial-property terms, what to ask before committing to premises and why an electrical capacity check should happen early in the decision process.

kW, kVA and amps: the basic difference

Electrical requirements are often described in different ways:

• kW means kilowatts. It is the real power the operation needs to perform work.
• kVA means kilovolt-amperes. It is the apparent electrical capacity required from the supply.
• Amps measure current.
• Power factor links kW and kVA.

The relationship is:

$$\text{kW} = \text{kVA} \times \text{Power Factor}$$kW=kVA×Power Factor

Or:

$$\text{kVA} = \frac{\text{kW}}{\text{Power Factor}}$$kVA=Power FactorkW​

Power factor matters because motors, compressors, pumps, refrigeration equipment, machinery and other industrial loads do not always convert all supplied electrical capacity into useful working power. For planning purposes, a power factor of 0.85 is often used as an initial assumption for a motor-heavy industrial operation, but the actual power factor must be confirmed by the client’s electrical engineer or equipment specification.

For a three-phase system:

$$\text{kW} = \frac{\sqrt{3} \times V \times A \times \text{Power Factor}}{1000}$$kW=10003​×V×A×Power Factor​

$$\text{kVA} = \frac{\sqrt{3} \times V \times A}{1000}$$kVA=10003​×V×A​

South African low-voltage industrial supply is commonly 400 V three-phase, with 230 V phase-to-neutral. 1323

What does 500 kW mean?

Assume a 400 V three-phase supply and a planning power factor of 0.85.

$$\text{kVA} = \frac{500}{0.85}$$kVA=0.85500​

$$\text{kVA} \approx 588\text{ kVA}$$kVA≈588 kVA

The approximate current requirement is:

$$\text{Amps} = \frac{500 \times 1,000}{\sqrt{3} \times 400 \times 0.85}$$Amps=3​×400×0.85500×1,000​

$$\text{Amps} \approx 849\text{ A}$$Amps≈849 A

So a 500 kW requirement may equate to approximately:

Requirement	Approximate planning figure
Real power demand	500 kW
Apparent power demand at PF 0.85	588 kVA
400 V three-phase current	849 A
Typical transformer starting point	630 kVA
More practical transformer consideration	750 kVA to 1 MVA, depending on the load profile and allowance for growth

A 630 kVA transformer is the mathematical starting point at a 0.85 power factor, but it may leave limited room for expansion, motor starting, future equipment or unexpected demand. The final requirement depends on the operation’s actual maximum demand, diversity, largest motors, starting method, power-factor correction and future plans.

What does 1 MW mean?

A 1 MW requirement is equivalent to 1,000 kW. At the same 0.85 planning power factor:

$$\text{kVA} = \frac{1,000}{0.85}$$kVA=0.851,000​

$$\text{kVA} \approx 1,176\text{ kVA}$$kVA≈1,176 kVA

$$\text{Amps} = \frac{1,000 \times 1,000}{\sqrt{3} \times 400 \times 0.85}$$Amps=3​×400×0.851,000×1,000​

$$\text{Amps} \approx 1,698\text{ A}$$Amps≈1,698 A

Requirement	Approximate planning figure
Real power demand	1,000 kW / 1 MW
Apparent power demand at PF 0.85	1,176 kVA / 1.18 MVA
400 V three-phase current	1,698 A
Typical transformer starting point	1.25 MVA
More practical transformer consideration	1.6 MVA or larger, depending on actual demand and growth allowance

At this level, a standard low-voltage supply arrangement is often not sufficient. The property may need a dedicated medium-voltage connection, on-site transformer infrastructure, a suitably sized main distribution board and electrical reticulation designed for the proposed load.

The actual solution depends on the local distributor’s network, the existing infrastructure at the property, available network capacity and the client’s load profile.

Why the advertised power supply is not enough

An industrial-property listing may say:

textPower: 400 amps
Power: 800 amps
Power: 1,000 amps
Three-phase power available
High power available

Those descriptions may be useful as an initial screening point, but they are not enough to establish whether the property can support a specific operation.

For example, at 400 V three-phase:

Existing supply	Approximate kVA capacity	Approximate kW at PF 0.85
100 A	69 kVA	59 kW
250 A	173 kVA	147 kW
400 A	277 kVA	236 kW
630 A	436 kVA	371 kW
800 A	554 kVA	471 kW
1,000 A	693 kVA	589 kW
1,600 A	1,109 kVA	943 kW
2,000 A	1,386 kVA	1,178 kW

This is an indicative table only. It assumes a balanced 400 V three-phase load and a power factor of 0.85 for the kW figures.

A property described as having “1,000 amps” may theoretically support around 589 kW at a 0.85 power factor. That does not mean 1,000 amps are necessarily available to a new occupier. There may already be existing loads, contractual demand limits, transformer constraints, cable constraints, phase imbalance, ageing switchgear or distributor limitations.

Ask what “500 kW” actually means

Before assessing property options, clarify the requirement with the client.

A request for “500 kW” may mean very different things:

• Total connected load of all equipment.
• Expected maximum demand.
• Continuous operating requirement.
• Peak demand that occurs only periodically.
• Future expansion requirement.
• Nameplate rating of machinery rather than simultaneous operating demand.
• Required generator capacity.
• A planning estimate rather than an engineered electrical-load schedule.

The distinction matters. A facility may have installed equipment totalling 500 kW, but the operation may never run all equipment at full load at the same time. Conversely, a business with a 500 kW calculated load may need materially more capacity because of motor starting, refrigeration peaks, process cycles, expansion plans or limited diversity.

Electricity distributors and utilities commonly assess contracted demand in terms of maximum demand or notified capacity, rather than simply adding every item of installed equipment. Eskom’s Notified Maximum Demand is the maximum kVA capacity contracted for at a point of delivery and is subject to network capacity being available. 1320

The property questions to ask early

A broker, occupier or owner should obtain more than the main breaker size before treating a property as viable.

1. What is the existing electrical supply?

Ask for:

• Existing supply voltage.
• Number of phases.
• Main breaker rating.
• Transformer size, if applicable.
• Whether the property has a dedicated transformer.
• Existing electrical single-line diagram, if available.
• Main distribution board capacity and condition.
• Existing generator, solar or battery systems.
• Electrical compliance documentation where relevant.

2. What capacity is contractually available?

The existing installation and the available contracted demand are not necessarily the same thing.

Ask:

• Who supplies the property: Eskom or the municipality?
• What is the existing notified maximum demand or contractual capacity?
• Is there spare capacity within the current agreement?
• Has the existing user been exceeding demand?
• Are there penalties, restrictions or upgrade applications in progress?
• Can the capacity be transferred, retained or increased for a new occupier?

Where Eskom is the distributor, an increase in NMD is not automatic: it is subject to capacity availability, application processes and quotation. Exceeding the agreed NMD can also result in excess-network-access charges under Eskom’s rules. 1320

3. Can the network support an upgrade?

A property may physically have room for a larger transformer or main board, but the local electricity network may not have available capacity.

The key questions are:

• Is there adequate capacity in the local electricity network?
• Will the distributor require a network upgrade?
• Is a medium-voltage connection required?
• Can an existing transformer be upgraded?
• Is a new transformer, switchgear or substation required?
• What approvals, lead times and contributions are likely?
• Who pays for the infrastructure work?
• Does the landlord need to approve the work?
• Will the installation remain with the property after the lease ends?

For new or additional Eskom supply, businesses follow a formal application process. Requirements, network design, cost and timing are site-specific. If the relevant municipality supplies the site, the application must be made to that municipality rather than Eskom. 1321

4. How will the equipment start and operate?

Motor starting can have a material impact on the required electrical design.

Ask:

• What are the largest motors, compressors, pumps or refrigeration units?
• Will they start direct-on-line, star-delta, through soft starters or variable-speed drives?
• Will several large items start simultaneously?
• Is power-factor correction included?
• Does the process operate continuously or in peaks?
• Are harmonics, voltage sensitivity or power-quality issues relevant?
• Does the operation need backup power during outages?

The right answer cannot be determined from a property brochure. It requires the occupier’s electrical engineer, equipment supplier or competent electrical contractor to prepare or verify a load schedule.

Why this matters in a lease negotiation

Power capacity should not be treated as a technical issue to resolve after a lease is signed.

If electrical capacity is essential to the operation, the lease or heads of terms should address:

• The minimum supply capacity required before occupation.
• Whether the agreement is conditional on a successful capacity assessment.
• Who applies for the upgrade.
• Who pays application, network, transformer, switchgear, cable and installation costs.
• How landlord approvals will be obtained.
• Who owns the upgrade at the end of the lease.
• What happens if the distributor cannot provide the required capacity.
• Whether occupation, rental commencement or fit-out obligations depend on the upgrade being complete.
• The timeline for approvals and infrastructure works.
• The allocation of risk if costs or lead times exceed expectations.

For a purchaser, similar issues should form part of pre-acquisition due diligence. A property may appear cheaper than alternatives because it lacks the electrical infrastructure required for the intended operation.

A practical example

Imagine a business requires an estimated 500 kW for a combination of manufacturing equipment, compressors, cooling systems, lighting, office use and future expansion.

The business finds a well-located factory with approximately 800 A, 400 V three-phase supply.

At a 0.85 power factor:

$$800\text{ A} \times 400\text{ V} \times \sqrt{3} \div 1,000$$800 A×400 V×3​÷1,000

$$\approx 554\text{ kVA}$$≈554 kVA

$$554\text{ kVA} \times 0.85$$554 kVA×0.85

$$\approx 471\text{ kW}$$≈471 kW

On the face of it, the property appears close to the requirement. But it may still be unsuitable if:

• 800 A is the breaker rating, not spare available capacity.
• Existing tenant loads remain connected.
• The 500 kW requirement is based on future expansion and needs margin.
• Large motors create substantial starting demand.
• The transformer, cables or switchgear cannot support the intended operation.
• The network cannot provide an upgrade within the occupation timeline.

A site that is “almost enough” can be more dangerous than one that is clearly inadequate. It may encourage the occupier to proceed before the technical and commercial risks have been properly resolved.

A practical property-search checklist

Before committing to an industrial property with meaningful power requirements, obtain answers to these questions:

• What is the client’s actual maximum demand in kW and kVA?
• What power factor should be assumed or has been measured?
• What is the existing supply voltage, phase arrangement and main breaker rating?
• What transformer capacity exists on site?
• What is the current contracted capacity or NMD?
• What capacity is actually spare and available to the incoming occupier?
• Is the property supplied by Eskom or the municipality?
• Has the distributor confirmed capacity at the site?
• Does the operation require a supply upgrade, new transformer or medium-voltage connection?
• What does the upgrade cost?
• What is the realistic lead time?
• Who carries the cost and risk under the lease or sale agreement?
• Does the operation require generator, solar, battery or other backup arrangements?
• Has a qualified electrical engineer reviewed the requirements and property infrastructure?

The bottom line

For a client requiring 500 kW, 1 MW or substantial future electrical capacity, power must be a primary property-selection criterion—not a late-stage technical enquiry.

A suitable industrial property is not simply one with enough floor area, yard space and a workable rental. It must also support the client’s operational infrastructure, including power demand, distribution capacity, expansion plans and resilience requirements.

The right approach is:

1. Define the client’s actual load requirement.
2. Screen available properties using credible electrical information.
3. Confirm capacity with the relevant electricity distributor.
4. Obtain electrical-engineering input before committing.
5. Make supply capacity, cost and timing part of the commercial negotiation.A property search starts with a requirement. A good industrial-property decision confirms whether the infrastructure can support it.

Need help assessing an industrial property decision?

If you are considering premises and power capacity is a critical part of the requirement, IndustrialProperty.co.za can help you frame the property brief, assess the commercial implications of the available options and identify the questions that need to be resolved before commitment.